Motorola has announced a new smartphone in the US with AT&T as it hopes to claw back ground lost over the last couple of years.

Priced at just $20 dollars cheaper than the Apple iPhone, Motorola believes the Karma, as it will be known, has the muscle to take on Apple and its iPhone.

Sporting an almost circular design the phone comes with a sliding QWERTY keyboard and a focus towards social networking.

However users keen to download the latest Twitter apps won't be able to. The phone won't be offering third party app support, instead offering Facebook and MySpace access pre-installed.

The "Motorola Karma is designed for effortless all-day, every-day mobile socializing with features such as text messaging, instant messaging and homescreen access to Facebook and MySpace", says AT&T in a statement, perhaps not realising that today's social networking is slightly more than text messaging and homescreen access.

Supposedly "Today's savvy mobile phone users are looking for more from their devices than just an easy way to text - they want to update their social networking status, instant message multiple friends, make calls and of course, text, all while on the go", said Jeff Miller, vice president, Motorola.

The Motorola Karma will be available on AT&T for $79.99 after mail-in rebate with a two-year service agreement for voice plans of $39.99 a month or higher and a $20 a month data or messaging plan.

No word on whether the phone, which comes with 3G support and a 2-megapixel webcam, will be heading to the UK.